Milk Wars

In Australia, big dairy and milk supplying companies have lost close to $730 million dollars. This is caused by the demand determinant: “Prices of Substitute Goods”. Many Australian supermarkets have significantly dropped the price of generic, no-name brands milk to $1 per liter. This decrease in the price of generic, no-name brand milk caused consumers to be less willing to buy its substitute good (which is brand named milk from big dairy supplying companies). This change in price caused a shift in demand to the left. This results in a decrease in price and production of milk by big companies.